Farmland Values in Iowa Fall for the First Time in 5 Years

Lower commodity prices and higher interest rates are starting to show up in land values. Two ag lenders say farmland values in Iowa fell for the first time in five years.

Farm Credit Services of America and Frontier Farm Credit released their benchmark farmland values report.

It showed since January land values have made modest gains in Eastern Kansas, Nebraska, South Dakota and Wyoming. It's a different story in Iowa, however, where the value of cropland has declined overall 2.4 percent.

“The combination of higher interest rates and tighter margins for grain producers is having an impact on cropland values,” said Tim Koch, executive vice president of business development for the two Associations, which operate as part of a collaboration.

But they say despite the pullback, Iowa's real estate values are up nearly 60-percent since 2019, and across all five states they serve, values remain at or near record levels.

View the full report here.

EDITOR’S TAKE:

As the report suggests, yes, there was a slight pullback in Iowa, but overall land values are still escalating in other surrounding states. And, farmland values remain at or near their all-time highs. Put it all together and farm/ranch balance sheets remain very strong. The bigger challenge for crop farmers will be lower commodity prices. Strong yields will compensate to some extent, but there is no question the expectation of lower net farm income will cause some tightening down the road. Does that mean farmers/ranchers will stop buying trucks? No way! They depend on trucks to make their operations run at max efficiency. Keep farmers/ranchers at the top of your customer prospect list and be sure to list your inventory on AgTruckTrader.com®. It is the only website aimed specifically at farmers/ranchers!